Is anybody buying the "car dealer analogies?

[SoCalDem]

Seems as if all the microphone-hogs have a "car dealer story" to tell...(see : Welfare queen with Cadillac, incubator babies thrown on floor, Harry & Louise Part 1)

Around here car dealers could not fit another car on their lots, no matter how many loans they could manage to get.. their problem is that no one is buying the ones they HAVE.. There are a few dealers around here who still have NEW 2007 SUVs that have not sold..

and it's not about the lack of loans... It's about the price of gasoline and the high costs of living, that have choked the life out of car-buying.. Loan or no loan, people don;t have expendable money to even make the payments on those $30K+ monsters and the insurance & upkeep on them..

Know what IS selling?

1980's & 90's Toyotas & Hondas.. People are snapping up those "throwaway cars".. the ones with 50K miles left in them, that cost $1k or less.. Buy 'em for cash, drive 'em until they die, and buy another one.. If it lasts a year, you've had wheels for less than $100 a month..and if you lose your job and get desperate for cash you can sell it for as much as you paid for it :)

Last week, there were THREE notes left on my husband's 1988 Dodge pick up..All wanted to buy it..

[Warpy]

1. I had people banging on my door every week

wanting to buy my old 4 cylinder Ford Ranger, and that thing was old enough to vote. That was in 2006, just as gas prices were shooting up for the first time and before the miraculous lowering of prices just prior to the election.

I think people realize I don't want to sell my little econocar. However, I'm getting notes on the door about selling my little 1946 post war crackerbox of a house. This area is prime for downsizers who want to cut their commute.

[jflood1016]

2. I think that the car dealer example is a good example.

It is important for people to understand the credit crisis and how it will impact businesses and consumers. When the banks limit credit line for businesses it will have a very negative impact on the economy.

[SoCalDem]

4. Frankly, car dealers borrowing to buy cars that no one will buy is NOT a great idea

:rofl:

nor is it a great idea for people in danger of losing their job, to be all hot & bothered to get a loan for a car they cannot afford to fill with gas, even if they did have a job to drive it to :rofl:

[jflood1016]

6. It is an example.

I work for a company that makes corrugated (cardboard) boxes. My customers often time will purchase my boxes with line of credit. When the banks, because of the bad debt they are currently holding, reduce my customers lines of credit they are unable to purchase the raw materials needed to sell their products. This not only affects my customer but it has an upstream effect on every other company that supplies raw materials. That is the point of the car dealership example. Something that people can put their arms around.

[lumberjack_jeff]

3. I was window shopping at the car lot last week.

New 4wd 3/4 ton gas and diesel chev pickups were more than 25% off sticker price, (Diesel; 48k marked down to 36k) and the dealer was throwing in some freebies (bedliner and a Lowes gift card).

Love to have a new truck, but not this month.

[Pathwalker]

5. Three dealerships in my town are closing - some fake, huh?

The dealerships can't get loans, and neither can their few customers. OTOH, the auto parts stores are doing great!

[SoCalDem]

9. Without realizing it, you have validated MY point..

getting loans or NOT getting loans. people cannot afford to keep buying cars, and there are TOO many car dealerships.. Cannibal capitalism/Darwinian-Republican capitalization is "working" its magic.. the strong survive..the weak do not.. The ones with shitloads of debt, and too many unsold cars, will fold, and others will survive.. It just is what it is.. like they tell us.. "we are where we are"..

When workers start making decent wages, and don't have to mortgage their lives for a new car, maybe they'll start buying them again..

[Pathwalker]

11. The used car dealerships here have very few cars on their lots,

because no one is selling the ones they have. And the new car dealerships have no used ones for sale - period. Lots of new ones, though, but no one's interested. My husband's store is talking executives in 3 piece suits through changing their own oil - they're not allowed to do that for the customer. They can change batteries and windshield wipers, but nothing else. Many, many stores are closing their doors here in Michigan - but we've been ahead of the curve for awhile. I expect other states will soon look more like Michigan in the months ahead.

I did realize I was making your point - so many on DU think things are just fine.

[slipslidingaway]

7. People have too much debt and that will just take time to work

through, encouraging people to take on more debt during this period is not helpful IMO.

[gopbuster]

8. The dealerships may have problems due to tightening lending standards...

I've noticed the $100 down no credit check high interest pay here used car lots doing better. We have them all over OKC.

[CTyankee]

10. I'm still tooting along in my 1999 Altima with 80k miles on it.

I keep it in great condition. It's been paid for now since 2001 and I'm happy as a clam. Frankly, I don't know what I would have done if I still had a car loan payment to make each month. I retired at the end of 04, took a part time job and only left it because I had health problems preventing me from working. Now I'm just retired, altho I'm fine physically. I just feel too old to work and too stressed by a job.

It's wonderful not having to worry myself half to death with car payments on top of everything else...

[TexasObserver]

12. When the economy is in a decline that is necessary, as now ...

... many facets of the economy lag, because people cannot get loans to buy things like cars. This happens EVERY recession. This is not the end of the world as we know. It is a standard, run of the mill, 20 year BUST. And guess what? Consumer goods that don't have to be bought lag badly. CARS always lag in a recession. The car sales market contracts, and car businesses go out of business.